12 CFR 235.1 - Authority and purpose.

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§ 235.1 Authority and purpose.

(a)Authority. This part is issued by the Board of Governors of the Federal Reserve System (Board) under section 920 of the Electronic Fund Transfer Act (EFTA) (15 U.S.C. 1693o-2, as added by section 1075 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, 124 Stat. 1376 (2010)).

(b)Purpose. This part implements the provisions of section 920 of the EFTA, including standards for reasonable and proportional interchange transaction fees for electronic debit transactions, standards for receiving a fraud-prevention adjustment to interchange transaction fees, exemptions from the interchange transaction fee limitations, prohibitions on evasion and circumvention, prohibitions on payment card network exclusivity arrangements and routing restrictions for debit card transactions, and reporting requirements for debit card issuers and payment card networks.

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

The Board is publishing a clarification of Regulation II (Debit Card Interchange Fees and Routing). Regulation II implements, among other things, standards for assessing whether interchange transaction fees for electronic debit transactions are reasonable and proportional to the cost incurred by the issuer with respect to the transaction, as required by section 920 of the Electronic Fund Transfer Act. On March 21, 2014, the Court of Appeals for the District of Columbia Circuit upheld the Board's Final Rule. The Court also held that one aspect of the rule—the Board's treatment of transactions-monitoring costs—required further explanation from the Board, and remanded the matter for further proceedings. The Board is explaining its treatment of transactions-monitoring costs in this Clarification.